It is safe to say that large acreage in most of the counties which were in play in Ohio's Utica are already leased. I believe in Ohio all the energy companies need is 65% of a unit and they can force pool the 35%. What we can deduce from the older Clinton units is that force pooling in urban areas were commonly applied. Are urban and suburban areas in the Utica at the point of being forced pooled? Is the reduction in lease bonus offers from $5000/20%, down to $4000/18%, a harbinger to force pooling by an energy company aggressively leasing in urban and suburban Mahoning county?
What mandates the need for pooling in a location? With the average that is leased in Ohio and areas available for lease I think it would be hard to establish a need drill a well in any one particular spot.
Question to plaintiff: How many parcels of land do you have leased in the state?
Answer 275,000 acres.
Question can you explain why this parcel is necessary and the value it represents to your company?
Option A. We just want to do what we want
B. We just can't live without it.
The following came from this website. http://www.steptoe-johnson.com/know-how/pooling-statutes-in-ny-md-o... I think the important thing is that they can only use it 5 times per year.
"Let’s move to Ohio - another state that has a statute in place that appears to be sufficient to regulate pooling of horizontal shale wells, both in the Marcellus, Utica and all formations. However, the issue with the Ohio statute is mainly process. The first step in the Ohio process is to file your application and have a hearing in front of the Oil and Gas Technical Advisory Board or Committee. However, this committee, meets only once per quarter. In addition, only five applications per entity may be filed in any given year. Now, there is a regulation that allows the committee to meet more than four times per year, either upon petition of the chairman or upon a motion by two of the members, but our research shows over 20 years this has only been done one time. So, while Ohio has a statute that on its face looks like it will promote large scale development, the process may actually impede such large scale development and pooling of horizontal shale wells. In addition, historically, Ohio has not looked at forced pooling as a method by which all units should be formed. They don’t look at pooling as a mechanism to replace what they call fair and aggressive leasing programs. They prefer that forced or statutory pooling only be used in cases where a lessor has been offered very reasonable terms and just refuses to accept or just wants to impede development, or in cases of missing heirs. So, in summary, while Ohio has a statute on its book, it is unknown whether it can be used to promote such large scale development and pooling resources."
This could be another or the main reason for CHKs and any other drillers current push to re-write leases for larger unit size. Do some leases have clauses that can pool folks into non adjacent units to be held by production and if so could they be bundled into a single application for forced pooling? Does Ohio even have a maximum unit size? Pro-rating based upon the rights owners surface foot print to the geologic struture.......that would and should require some good verifiable siesmic study. Alot of siesmic studies are being done. I would think if an O&G conpany takes a mineral owner to task with this the siesmic data should be made public so it can be scrutinized at the very least.
I personally do not think that forced pooling will be a norm in Ohio, The basic concept of private property weighs heavily while the issue of drilling is not one of imminent domain. I can not perceive where a drawn out legal battle with big players such as the Sierra Club in a effort to halt drilling would allow it to be a cut and dry matter without taking it to the supreme court. The due process would have to be through.
I"m pretty sure that the law was put in effect to protect the landowners from one of their greedy neighbors trying to hold out for more $$$. Dont really think the O&G co.s will need to use the forsed pooling law very often ,cause most people will finally sign on when they know they are getting what their neighbors got. It could be an issue if thier neighbors all got scammed into a $50. pr acre deal way back when. If they can only do it 5 times ,they will try their best to lease all in the unit if possible. Glad to be in Ohio!.
The law has several aspects to it. One private property, it's a two way street If I want to allow them to drill upon my property fine if I don't want them around my bass pond I built by myself then fine stay out!
Two establish a reason, proof of having a significant amount of land that would be impacted if a persons property voided the use of that land.
Three , insure that a fair price was established for use of land if need be.
I am pro drilling but I am for property owners rights, from a private owned bar to allow smoking if they care to or ban it if they want. To grow shrimp instead of frogs if it's your property.
Without this you may as well throw your hands up and give it to the government.,
I like shrimp, but what is wrong with frogs Billy?
Perhaps another way to look at is how many are integrated using forced pooling in other states, here is force integration hearings list for one month in arkansas, some interesing reading, the first one listed is as good as any (read the resume of efforts to lease Exhibit C for some interesting stuff)